Shares in Fiat Chrysler Automobiles (FCA) fell at open on Thursday as traders said investors were selling the stock after buying a bond that convert into shares.
The car maker priced on Thursday a $2.5 billion mandatory convertible bond due in 2016, and also an offering of 87 million shares at $11 dollar each.
“Investors are arbitraging between the stock and the covertible notes,’’ one trader said. A second trader confirmed the convertible issue was the reason driving the shares lower.
By 0820 GMT, shares in FCA fell 5 per cent to €9.335, after initially failing to start trading at open.